How marijuana businesses reacted to COVID 19?SPEED.GREENS
Covid19 or the novel coronavirus pandemic is changing the world as we knew it. The worst affected countries have been forced to go on extensive nation-wide lockdowns to curb the rate of infection. Our normal routines and usual habits are disrupted, long-distance travels are halted. Industries, businesses and service sectors are severely hit. Scientists and medical experts are grappling for vaccines and cures which still seem elusive.
In these times of global confusion, panic and uncertainties, there has been much talk about marijuana and Covid19. The internet is flooded with queries on this issue, many of which want to know whether weed can cure coronavirus infection. Although scientists and physicians from all over the world have come up to refute the claim, this is not a place to elaborate on that. In this article, we ask a different, but pertinent, question on marijuana and Covid19 – how have the marijuana businesses reacted to Covid19 across the globe?
Covid19 and its impact on the businesses
Besides being a health risk and human tragedy of an epic scale, the Covid19 pandemic has also produced a crippling effect on global economy. All over the world, shops and factories are shut down, labor market is dwindling, works have been stopped, airports closed, movements of goods and men are severely restricted, businesses are struggling with low revenues. The world has not witnessed a greater economic crisis ever before. Owners of businesses are suddenly faced with a lot of issues – how to go on with their businesses by ensuring the safety their employees and customers, navigating and managing various restrictions imposed by the governments, keeping the cash flow and liquidity intact, and most importantly increase the revenue.
While the negative impact of the pandemic has been truly brutal on small-scale enterprises and startups, the more well-established, big businesses are also not spared. Currently, there is an unprecedented uncertainty in the global financial market. IMF says that the global economy is going to decline over 3% in 2020. According to economists and market analysts, the world economy has not seen such a steepest slowdown since the great depression of the 1930s.
Marijuana and Covid19 – How hard the weed industry has been hit?
Like all other businesses in the world, marijuana industry is not immune to the negative impacts of Covid19. Many cannabis companies have been forced to downsize and laid off thousands of employees. The supply chain has been significantly hit. The lockdowns have led many stores to temporarily shut down, or cut the business hours. The mail order delivery services are also affected. Cole Miller, the founder of the premium Canadian marijuana company A1 Cannabis Co., points out, ‘Cannabis companies have been largely mismanaged and have put themselves in some pretty precarious cash positions, where a lot of them are running out of cash or sales expectations are out there.’ The industry, according to Miller, is in trouble no doubt.
Marijuana and Covid19 – How the marijuana industry have reacted to the pandemic?
However, it is not all bleak. Now, after more than 3 months of living with the pandemic, there are reports that the cannabis industry has been proving to be quite resilient to the crisis it is facing. Marijuana businesses across the world have reacted quite innovatively to the Covid19 pandemic and managed to transform the crisis into some sort of an opportunity.
• Adjustments to retail operations
The Covid19 restrictions and lockdowns have forced the marijuana businesses to make adjustments to their retail operations which include regular sanitization of their storefronts, introducing social distancing protocols and limiting the number of customers in the stores at a given time, curbside pickups and deliveries, postponing live promotional events and finding new ways to communicate with their customers.
• Taking their businesses online
All across the globe, the Covid19 pandemic has fuelled a push for e-commerce and online transactions. To adapt to this unprecedented crisis, marijuana businesses are now relying more on online sales and promotions. According to Rebecca Brown, founder and CEO of the Toronto-based marijuana marketing and brand consultants Crowns Agency, ‘People are shopping online, in general, in record numbers, and people are glued to their screens, and our entire culture has shifted and become virtual in a week.’ Brown says that there has never been a time when digital marketing and online sale of marijuana has been so necessary. In the last few months, there has been a spectacular surge in both digital promotion and messaging as well as in online marijuana sales. To improve patient access, many medical marijuana companies and dispensaries are now offering telemedicine and online consultation services to their customers.
• Limiting cash transaction
As handling the cash poses a risk of coronavirus spread, many marijuana businesses are now changing their practices to encourage e-wallet transactions and cashless payments. Many cannabis retail shops and mail order services in the US and Canada are installing cashless ATMs to ensure contactless payments.
• Designated as ‘essential’ service
One of the main factors behind the resilience of the marijuana industry is that the local governments in many US states as well as the federal government of Canada has declared marijuana as ‘essential services’ and granted exemptions from the lockdown regulations. This has helped the pot dispensaries to remain open and keep their businesses afloat.
According to numerous reports and studies, the mandatory ‘stay-at-home’ orders in the pandemic-hit countries have been a major push for cannabis sales. People are panic buying and stockpiling weed along with grocery or other essential items to prepare for the long periods isolations. This has been resulted in a massive surge in the cannabis sales.
One of the premium cannabis distributors of Ontario, Canada, has witnessed a record 80% spike in sales in recent weeks. As Miller says, ‘Consumers are going to continue to buy cannabis, and they’re not going to slow down.’ The pandemic has nothing but increased and consolidated the demand in the cannabis market, which holds an excellent future for the marijuana industry in general.